20 October 2005

Guns and Cheeseburgers.

Congress passed two tort reform type bills this week. One, the "cheeseburger bill", H.R. 554, is designed to prevent people from suing fast food restaurants for making people fat. The other (the Protection of Lawful Commerce in Arms Act), S. 397, is designed to protect gun dealers from liability when they sell guns that are later used in crimes. The devil is in the details in bills like these, so I have provided the text of the operative provisions below.

a civil action brought by any person against a manufacturer, marketer, distributor, advertiser, or seller of a qualified product [Ed. i.e. food], or a trade association, for damages, penalties, declaratory judgment, injunctive or declaratory relief, restitution, or other relief arising out of, or related to a person's accumulated acts of consumption of a qualified product and weight gain, obesity, or a health condition that is associated with a person's weight gain or obesity, including an action brought by a person other than the person on whose weight gain, obesity, or health condition the action is based, and any derivative action brought by or on behalf of any person or any representative, spouse, parent, child, or other relative of that person.

(B) EXCEPTION- A qualified civil liability action shall not include--

(i) an action based on allegations of breach of express contract or express warranty, provided that the grounds for recovery being alleged in such action are unrelated to a person's weight gain, obesity, or a health condition associated with a person's weight gain or obesity;

(ii) an action based on allegations that--

(I) a manufacturer or seller of a qualified product knowingly violated a Federal or State statute applicable to the marketing, advertisement, or labeling of the qualified product with intent for a person to rely on that violation;

(II) such person individually and justifiably relied on that violation; and

(III) such reliance was the proximate cause of injury related to that person's weight gain, obesity, or a health condition associated with that person's weight gain or obesity; or

This bill covers suits that would be speculative, at best, and is quite narrowly tailored. If food makes you sick for some reason other than weight gain, it isn't covered. The only grounds for suit remaining related to weight gain is basically a suit for fraud in marketing that actually causes you to get fat and suffer health consequences (the scenario that comes to mind would be someone intentionally selling regular soda under a label stating that it was diet soda over a period of many years). It does have a questionable retroactivity provision as well, however.

The Gun Bill

The gun suit ban covers:

a civil action or proceeding or an administrative proceeding brought by any person against a manufacturer or seller [Ed. with a license to manufacture, sell or import guns and/or ammunition] of a qualified product [Ed. i.e. a firearm or ammunition which has been involved in interstate commerce], or a trade association, for damages, punitive damages, injunctive or declaratory relief, abatement, restitution, fines, or penalties, or other relief' resulting from the criminal or unlawful misuse of a qualified product by the person or a third party, but shall not include--(i) an action brought against a transferor convicted under section 924(h) of title 18, United States Code, or a comparable or identical State felony law, by a party directly harmed by the conduct of which the transferee is so convicted;

(ii) an action brought against a seller for negligent entrustment or negligence per se [Ed. the term `negligent entrustment' means the supplying of a qualified product by a seller for use by another person when the seller knows, or reasonably should know, the person to whom the product is supplied is likely to, and does, use the product in a manner involving unreasonable risk of physical injury to the person or others.];

(iii) an action in which a manufacturer or seller of a qualified product knowingly violated a State or Federal statute applicable to the sale or marketing of the product, and the violation was a proximate cause of the harm for which relief is sought, including--

(I) any case in which the manufacturer or seller knowingly made any false entry in, or failed to make appropriate entry in, any record required to be kept under Federal or State law with respect to the qualified product, or aided, abetted, or conspired with any person in making any false or fictitious oral or written statement with respect to any fact material to the lawfulness of the sale or other disposition of a qualified product; or

(II) any case in which the manufacturer or seller aided, abetted, or conspired with any other person to sell or otherwise dispose of a qualified product, knowing, or having reasonable cause to believe, that the actual buyer of the qualified product was prohibited from possessing or receiving a firearm or ammunition under subsection (g) or (n) of section 922 of title 18, United States Code;

(iv) an action for breach of contract or warranty in connection with the purchase of the product;

(v) an action for death, physical injuries or property damage resulting directly from a defect in design or manufacture of the product, when used as intended or in a reasonably foreseeable manner, except that where the discharge of the product was caused by a volitional act that constituted a criminal offense then such act shall be considered the sole proximate cause of any resulting death, personal injuries or property damage; or

(vi) and action or proceeding commenced by the Attorney General to enforce the provisions of chapter 44 of title 18 or chapter 53 of title 26, United States Code.

Pending actions are dismissed (although I would think that there are legal issues over whether that is impermissible retroactive legislation).

Negligence per se, means a lawsuit based on a violation of an existing law designed to prevent the harm that actually happened from happening (e.g. a sale to a minor in violation of state or federal law that results in the accidental death of the minor).

The act also requires people who sell handguns to the general public provide child safety locks with the sale, but the only penalty for failing to do so is revocation of a dealer's license, not civil or criminal liability. In connection with that requirement the law provides that:

Notwithstanding any other provision of law, a person who has lawful possession and control of a handgun, and who uses a secure gun storage or safety device with the handgun, shall be entitled to immunity from . . . . a civil action brought by any person . . . for damages resulting from the criminal or unlawful misuse of the handgun by a third party, if-- (I) the handgun was accessed by another person who did not have the permission or authorization of the person having lawful possession and control of the handgun to have access to it; and (II) at the time access was gained by the person not so authorized, the handgun had been made inoperable by use of a secure gun storage or safety device; and (ii) shall not include an action brought against the person having lawful possession and control of the handgun for negligent entrustment or negligence per se.

The gun bill also bans the production of armor piercing ammunition for non-governmental domestic use, and sets a minimum sentence of 15 years in prison for people who possess armor piercing ammunition while committing a crime of which they are convicted (or a choice between the death penalty and life imprisonment for cases where a murder is committed with armor piercing ammunition).

Conclusion.

As tort reform efforts go, both of these bills are very narrowly targetted at just a handful of suits that were not sure things in the first place, and they are largely a reaction to the success of the tobacco litigation. And, the tobacco litigation might even have survived a bill like the cheeseburger bill, because a key element of the tobacco cases was fraud on the part of tobacco companies in hiding what they knew about health risks and addiction risks. Likewise, the gun suit shield has negligent entrustment and negligence per se exceptions that don't entirely shut the door on suits against gun dealers who carelessly sell guns to people the gun owner should know are likely to commit crimes or in violation of laws governing gun dealers (which is the gist of at least some claims in these kinds of suits).

Thus, while it is a symbolic victory for a couple of industries, this is not wholesale tort reform, and the gun industry still failed to pass its bill by a huge majority, which implies that more serious tort reform legislation could have a harder time in Congress.

Looking at it again, I should add that one of the biggest impacts of this law is that you cannot sue a gun owner for careless storage of a gun resulting in an injury if the safe harbor requirements are followed (i.e. child safety locks), even if other circumstances (e.g. a note in the unlocked gun cabinet saying where the key is) make those precautions seem negligent in the eyes of a jury.